Seray Karaalp is
an associate in the Banking &amp; Finance Practice at <a href="https://turkishlawblog.com/contributors/detail/esin-attorney-partnership" target="_blank" style="color: rgb(3, 102, 132);">Esin Attorney Partnership</a>.She specializes in project finance, public-private partnerships,
loans and credit facilities. She has experience in representing various local
and international sponsors and lenders in the financing of several projects in
various infrastructure sectors. Seray also regularly advises major Turkish
banks and companies on various legal aspects of their daily operations and
transactions. Practice Areas &amp; Work Department

Banking &amp; Finance

Capital Markets

Fintech

&nbsp; 

Languages

Turkish 

English 

French

&nbsp; 

Memberships

Istanbul Bar Association, 2018

Esin Attorney Partnership

Associate

&lt;h2 style="box-sizing: border-box; font-family: bakermckenzieberniniheader; font-weight: 500; color: rgb(17, 17, 17); margin-top: 20px; margin-bottom: 10px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 24px;">&lt;strong style="box-sizing: border-box; font-weight: 700; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">Recent developments&lt;/strong>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">&lt;span style="font-size: 14px;">The Regulation Amending the Regulation on Payment Services and Electronic Money Issuance and Payment Service Providers (“&lt;/span>&lt;strong style="font-size: 14px; box-sizing: border-box; font-weight: 700;">Regulation&lt;/strong>&lt;span style="font-size: 14px;">“) prepared by the Central Bank of the Republic of Türkiye (“&lt;/span>&lt;strong style="font-size: 14px; box-sizing: border-box; font-weight: 700;">CBRT&lt;/strong>&lt;span style="font-size: 14px;">“) was published in the Official Gazette on October 7, 2023. You can access the Regulation&nbsp;&lt;/span>&lt;a href="https://urldefense.com/v3/__https:/esinxchange.com/collect/click.aspx?u=ZkFHUUhIanBHZEFJbGh1VFJYV0NGQWdvOHAzdFZUN3Z1ZllkaTFHRVRSVkRaNUNIMkdBTDlyckJ0VWFvQnI5elhmdUdqQm1BcWhQd01YUlNzcUttUWQ4SGlqZFdYOGpoZVlWeXpkZ2MraEk5T1hhV05hS2VZYWJraUgvVlhKSWY=&amp;rh=ff00b6be893949e71cff73d7d443b9bc95ca3768__;!!Hj9Y_P0nvg!QFcLt9FbxTWJXu7-SOI7aX9HVQSvaKFJgqVpQlhtG4ii3ZBKeDSARC0pxuIXH3iZFgXJrewz6hV-ePKhEz1WybJ3tg$" style="box-sizing: border-box; background: 0px 0px; color: rgb(3, 102, 132); text-decoration: none; outline: none !important;" target="_blank" rel="nofollow">here&lt;/a>&lt;span style="font-size: 14px;">.&lt;/span>&lt;/span>&lt;/p>&lt;h2 style="box-sizing: border-box; font-family: bakermckenzieberniniheader; font-weight: 500; color: rgb(17, 17, 17); margin-top: 20px; margin-bottom: 10px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 24px;">&lt;strong style="box-sizing: border-box; font-weight: 700; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">What’s new?&lt;/strong>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">The Regulation added the definition of digital wallet to the regulations in the field of payments for the first time and regulated the procedures and principles regarding the provision of digital wallet services. In this way, it aims to popularize the use of digital payments in an easy and cost-effective manner through digital wallet applications.&lt;/span>&lt;/p>&lt;h2 style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;u style="box-sizing: border-box; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">&lt;span style="font-size: 14px;">a. &lt;/span>What is a digital wallet?&lt;/u>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">The Regulation defines a digital wallet as an electronic device, online service or application that stores information about the payment account or payment instrument used by the client, and enables the client to perform payment transactions using this information.&lt;/span>&lt;/p>&lt;h2 style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;u style="box-sizing: border-box; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">&lt;span style="font-size: 14px;">b. &lt;/span>What is not a digital wallet?&lt;/u>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">The following will not be considered digital wallet: services (i) provided by persons who store sensitive client data on behalf of the merchant or payment service provider within the limits permitted by the legislation within the framework of their contractual relationship, who are not a direct party to any legal transaction with the client in this respect, and who do not create the impression to the client that the payment transaction is carried out through the storing legal entity; (ii) where the storing legal entity does not own the funds subject to the payment transaction at any stage of the payment transaction and (iii) where the rights and obligations regarding the activity carried out are clearly defined in the agreement between the parties. Those who provide these services will not be required to be established as payment service providers.&lt;/span>&lt;/p>&lt;h2 style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;u style="box-sizing: border-box; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">&lt;span style="font-size: 14px;">c. &lt;/span>Who can offer digital wallet services?&lt;/u>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">The Regulation provides the following:&lt;/span>&lt;/p>&lt;ul style="box-sizing: border-box; margin-top: -15px; margin-bottom: 10px; padding-left: 20px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: start; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px; list-style-type: square;">&lt;li style="box-sizing: border-box; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">Payment service providers can offer digital wallet services. Payment service providers that will offer this service must have an operating license limited to issuing payment instruments.&lt;/span>&lt;/li>&lt;li style="box-sizing: border-box; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">If the digital wallet is used as a means of payment at merchants and the funds related to the payment transaction are transferred through the institution providing the digital wallet service, the institution providing the service must be authorized to issue electronic money.&lt;/span>&lt;/li>&lt;li style="box-sizing: border-box; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">For the payment account or payment instrument added to the digital wallet to be used directly in the payment transaction to be carried out at the merchant, if the digital wallet service provider provides the necessary payment services to the merchant and the funds for the payment transaction are transferred through the digital wallet service provider, the service provider will not be required to be authorized to issue electronic money.&lt;/span>&lt;/li>&lt;li style="box-sizing: border-box; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">If the digital wallet is valid as the payment account with another payment service provider added to the digital wallet, or the payment instrument issued by another payment service provider is used directly in the payment transaction at merchants, the service provider must be authorized to initiate payment orders.&lt;/span>&lt;/li>&lt;/ul>&lt;h2 style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;u style="box-sizing: border-box; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">&lt;span style="font-size: 14px;">d. &lt;/span>When is the deadline to obtain an operating license to offer digital wallet services?&lt;/u>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">Persons who were offering digital wallet services before October 7, 2023, the date that the Regulation was published, and who can be included in the category of payment institution or electronic money institution but do not have an operating permit must apply to the CBRT and obtain the necessary permits by October 7, 2024.&lt;/span>&lt;/p>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">Payment service providers that were offering digital wallet services before this date must comply with the regulations by October 7, 2024.&lt;/span>&lt;/p>&lt;h2 style="box-sizing: border-box; font-family: bakermckenzieberniniheader; font-weight: 500; color: rgb(17, 17, 17); margin-top: 20px; margin-bottom: 10px; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 24px;">&lt;strong style="box-sizing: border-box; font-weight: 700; font-family: Arial, Helvetica, sans-serif; color: rgb(10, 9, 9); font-size: 14px;">Conclusion&lt;/strong>&lt;/h2>&lt;p style="box-sizing: border-box; margin: 0px 0px 20px; padding: 0px; color: rgb(17, 17, 17); font-family: bakermckenzieberniniregular; font-style: normal; font-variant-ligatures: normal; font-variant-caps: normal; font-weight: 400; letter-spacing: normal; orphans: 2; text-align: justify; text-indent: 0px; text-transform: none; white-space: normal; widows: 2; word-spacing: 0px; -webkit-text-stroke-width: 0px; background-color: rgb(255, 255, 255); text-decoration-thickness: initial; text-decoration-style: initial; text-decoration-color: initial; font-size: 13px;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px; color: rgb(10, 9, 9);">The Regulation includes the definition of digital wallet for the first time in the field of payments and introduces important regulations for the widespread use of digital wallet services.&lt;/span>&lt;/p>

The Regulation Amending the Regulation on Payment Services and Electronic Money Issuance and Payment Service Providers (“Regulation“) prepared by the Central Bank of the Republic of Türkiye (“CBRT“) was published in the Official Gazette on October 7, 2023.

Digital Wallet Era Begins in Türkiye

&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Recent developments
&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">The Banking Regulatory and Supervisory Authority ("&lt;strong>BRSA&lt;/strong>") presented the Draft Communiqué on Green Asset Ratio ("&lt;strong>Draft Communiqué&lt;/strong>") on the procedures and principles regarding the calculation and reporting of the green asset ratio and other key performance indicators determined for the calculation of banks' contribution to the financing of environmentally sustainable economic activities to the finance sector for comments and opinions. Within the scope of the Draft Communiqué, banks will be obliged to report their green asset ratio to the BRSA at certain intervals. You can access the Draft Communiqué &lt;/span>&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">&lt;a href="https://www.bddk.org.tr/Mevzuat/DokumanGetir/1195" target="_blank" style="color: rgb(0, 99, 130);">here&lt;/a>&lt;/span>&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">.&lt;/span>&lt;/p>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">What's new under the Draft Communiqué?&lt;/strong>&lt;/h2>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">1. Primary key performance indicator&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">According to the Draft Communiqué, the primary key performance indicator for the determination of Turkish banks' contribution to environmental sustainability is the green asset ratio.
&lt;/span>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">The green asset ratio is calculated by dividing the compliant assets in banks' unconsolidated balance sheets by the eligible assets. Therefore, the concept of compliant assets and eligible assets are crucial in calculating the green asset ratio.&lt;/span>&lt;/p>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">1.1. Compliant assets&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Compliant assets are calculated by summing the gross amount of on-balance sheet financial assets measured at amortized cost that are related to economic activities and meet all three criteria below at the same time.&lt;/span>&lt;/p>&lt;p style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">a) Contribute significantly to one or more of the environmental objectives&lt;/strong>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">To be considered a compliant asset, a financial asset must serve the objectives under the European Union Taxonomy classification system for activities considered environmentally sustainable by the European Union ("&lt;strong>EU Taxonomy&lt;/strong>"), which are as follows:&lt;/span>&lt;/p>&lt;ul style="list-style-type: square;">&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Climate change mitigation
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Adaptation to climate change
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Transition to a circular economy
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Sustainable use and conservation of water and marine resources
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Prevention and control of pollution
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Preservation and restoration of biodiversity and ecosystems&lt;/span>&lt;/li>&lt;/ul>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Accordingly, financial assets are required to contribute significantly to at least one of the above environmental objectives. However, pursuant to Provisional Article 1 of the Draft Communiqué, only environmental targets numbered&lt;strong> (i) &lt;/strong>and &lt;strong>(ii)&lt;/strong> will be taken into account in the calculation of the green asset ratio until other environmental targets are taken into scope by the BRSA.&lt;/span>&lt;/p>&lt;p style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">b) No significant harm to other environmental objectives&lt;/strong>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Financial assets that qualify as compliant assets must contribute to one or more of the environmental objectives listed above, while not causing significant harm to any of the remaining environmental objectives. In determining whether an activity meets the criterion of not causing significant harm to the environment, the following five criteria enclosed to the Draft Communiqué will be taken into account:&lt;/span>&lt;/p>&lt;ul style="list-style-type: square;">&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Violation of the condition of no significant harm to the environment
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Climate risk vulnerability assessment
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Sustainable use and conservation of water and marine resources
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Pollution prevention and control related to the use and presence of chemicals
&lt;/span>&lt;/li>&lt;li style="margin-left: 20px; text-align: justify; line-height: 2;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Biodiversity and ecosystem restoration and protection.&lt;/span>&lt;/li>&lt;/ul>&lt;p style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">c) Providing minimum social security measures&lt;/strong>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Activities related to compliant assets and related parties will be required to provide the minimum security measures set out in the Draft Communiqué. To be classified as compliant under the Draft Communiqué, the activity must not be contrary to human and labor rights, corruption, tax and competition laws, and the business carrying out the activity must comply with the responsible business conduct standards in the OECD Guidelines for Multinational Enterprises, the eight fundamental conventions defined in the International Labor Organization's Declaration on Fundamental Principles and Rights at Work, the UN Guiding Principles on Business and Human Rights and the International Bill of Human Rights.&lt;/span>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Within the framework of the specified standards and principles, the compliance of an enterprise or an activity with minimum security measures will be assessed according to respect for human, labor and consumer rights, combating bribery and corruption, compliance with tax regulations and compliance with fair competition regulations.&lt;/span>&lt;/p>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">1.2. Eligible assets&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Eligible assets will be calculated by summing up the gross amount of on-balance sheet financial assets measured at amortized cost for all economic activities identified in the EU Taxonomy technical screening criteria, regardless of whether they meet the technical screening criteria set out in the Draft Communiqué.&lt;/span>&lt;/p>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">2. Additional key performance indicators&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">According to the Draft Communiqué, additional key performance indicators for Turkish banks' contribution to environmental sustainability are "compliant assets/gross assets" and "eligible assets/gross assets" ratios.
&lt;/span>&lt;/p>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Gross assets will be calculated as the sum of the gross amounts measured at amortized cost of the remaining on-balance sheet assets after subtracting receivables from central governments, central banks and multilateral investment banks and development institutions, as well as assets held for trading from total financial assets.&lt;/span>&lt;/p>&lt;h2 style="text-align: justify;">&lt;strong style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">Conclusion&lt;/strong>&lt;/h2>&lt;p style="text-align: justify;">&lt;span style="font-family: Arial, Helvetica, sans-serif; font-size: 14px;">The Draft Communiqué, which takes into account local regulations and bank practices but relies heavily on the EU Taxonomy framework, is significant as it plans to introduce a mandatory measurement of banks' contribution to the financing of environmentally sustainable economic activities and requires long-term structural reforms for banks.&lt;/span>&lt;/p>

The Banking Regulatory and Supervisory Authority ("BRSA") presented the Draft Communiqué on Green Asset Ratio ("Draft Communiqué") on the procedures and principles regarding the calculation and reporting of the green asset ratio and other key performance indicators determined for the calculation of banks' contribution to the financing of environmentally sustainable economic activities to the finance sector for comments and opinions. Within the scope of the Draft Communiqué, banks will be obliged to report their green asset ratio to the BRSA at certain intervals.

Lawyers Seray Karaalp

Seray Karaalp

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BRSA Releases Green Asset Regulation